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Is Verde Agritech Plc (TSE:NPK) Excessively Paying Its CEO?

Simply Wall St

The CEO of Verde Agritech Plc (TSE:NPK) is Cristiano Veloso. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

See our latest analysis for Verde Agritech

How Does Cristiano Veloso's Compensation Compare With Similar Sized Companies?

Our data indicates that Verde Agritech Plc is worth CA$18m, and total annual CEO compensation was reported as CA$496k for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at CA$420k. We examined a group of similar sized companies, with market capitalizations of below CA$261m. The median CEO total compensation in that group is CA$212k.

It would therefore appear that Verde Agritech Plc pays Cristiano Veloso more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

You can see, below, how CEO compensation at Verde Agritech has changed over time.

TSX:NPK CEO Compensation, January 20th 2020

Is Verde Agritech Plc Growing?

Over the last three years Verde Agritech Plc has shrunk its earnings per share by an average of 13% per year (measured with a line of best fit). Its revenue is up 685% over last year.

As investors, we are a bit wary of companies that have lower earnings per share, over three years. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Verde Agritech Plc Been A Good Investment?

Boasting a total shareholder return of 51% over three years, Verde Agritech Plc has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

We compared the total CEO remuneration paid by Verde Agritech Plc, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

Over the last three years returns to investors have been great, though we might have liked stronger business growth. So, considering these tasty returns, the CEO compensation may be quite appropriate. Whatever your view on compensation, you might want to check if insiders are buying or selling Verde Agritech shares (free trial).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.